Firms argue Australia is acquiring their propertyTobacco firms are worried other countries will follow suitCigarettes to be sold in olive-brown packs from December

Australia's Federal Government and four tobacco giants are about to face off in the High Court over Labor's world-first laws requiring all cigarettes to be sold in plain packages.

The three-day hearing starts this morning before the seven justices of the full court.British American Tobacco (BAT), Philip Morris, Imperial Tobacco Australia and Japan Tobacco International claim the government's legislation, which passed parliament in November, is unconstitutional.

They argue the Commonwealth is acquiring their property - in the form of brand names and logos - without just compensation.

But the government, in its submission to the High Court, says that's rubbish because it is not getting any benefit.Rather than taking over the companies' brands it says the legislation simply restricts their use "in a manner appropriate and adapted to reducing harm to members of the public".

Big tobacco is throwing everything at the legal challenge because it is worried other countries could follow Australia's lead if the government wins the day.

High-profile barrister Geoffrey Robertson last night said the laws will easily withstand a legal challenge from big tobacco because the Commonwealth is on solid legal ground.

"You're going to win it," he told Attorney-General Nicola Roxon on ABC television's Q and A program. "I've read the brief."Mr Robertson said forcing all cigarettes to be sold in drab olive-brown packs from December was a "brilliant Australian idea" and cigarette manufacturers were right to be terrified.

"It does turn people off," he said last night. "It says: 'This is a hazardous thing'."BAT spokesman Scott McIntyre says the stoush will operate as a "test case" on the validity of plain packaging legislation."As a legal company selling a legal product we have continually said we will defend our property on behalf of our shareholders as any company would," Mr McIntyre said.

However, Attorney-General Nicola Roxon believes the government is on strong legal ground.Earlier this month she said: "Plain packaging of tobacco products is a legitimate measure designed to achieve a fundamental objective - the protection of public health."

The Commonwealth argues that even if big tobacco could prove the government was acquiring their property rights the manufacturers still wouldn't win in court.

That's because the purpose of the plain packaging legislation - namely to improve public health - is within the scope of the Commonwealth's legislative power under the constitution's commerce, trade and external affairs powers.

The Queensland, ACT and the Northern Territory attorneys-general are all intervening in the High Court case along with the Cancer Council of Australia.

Labor's laws will force all cigarettes to be sold in drab olive-brown packs from December 2012.

ELIZABETH JACKSON: While the Australian Government is preparing to do legal battle with cigarette companies over plain packaging, it's inspired the UK government to head in the same direction.

The British health secretary, Andrew Lansley, has told our correspondent Philip Williams that he wants to pave the way for plain packaging legislation in the UK.

PHILIP WILLIAMS: Australia has seen it all before but now Britain is following in its wake.

The push for plain packaging is just starting in the UK, with a consultation process aimed at stopping young people taking up the habit.

The health secretary, Andrew Lansley, says 5 per cent of 11 to 15 year olds are regular smokers, adding to a habit that cost this country 100,000 lives each year.

Robin Hewings is the tobacco control manager at Cancer Research UK.

ROBIN HEWINGS: The work of the Australian Government on this issue has been really important. We know Andrew Lansley, our health secretary here says that talking to Nicola Roxon was one of the things that inspired him to have a consultation on plain packaging. And the kind of strength that the Australian government is showing in response to the current tobacco industry legal action and bullying and so on, I think has also kind of helped us as well.

PHILIP WILLIAMS: The cigarette companies are as stridently against any change here as they are in Australia.

Alex Parsons is the director of communications for Imperial Tobacco. He says a packaging ban would simply fuel the counterfeit industry and he denies there's any evidence children are attracted by cigarette packaging in the first place.

ALEX PARSONS: The idea that children are going into their local shop to buy sweets and a comic and then are seeing coloured packs of cigarettes behind the retailer counter and are compelled to try and purchase cigarettes, is just ludicrous; there's just no evidence to support that at all.

PHILIP WILLIAMS: Not so says Professor Linda Bauld from the University of Stirling.

LINDA BAULD: So the industry has put all its funding, almost all its advertising and marketing budget into creating innovate, brightly coloured packs. And we've seen an explosion of innovation on packaging in recent years and we know that those packs do appeal to children.

PHILIP WILLIAMS: That's strongly supported by many MPs, including Liberal Democrat Stephen Williams, who chairs a parliamentary committee on smoking.

Like many, he has a story of personal loss that fuels his anger against the tobacco industry.

STEPHEN WILLIAMS: My father was a smoker but he died young; he died when he was 42 and one of the causes of his death was respiratory failure. And that's one of the main reasons why, as a politician, I am very much against smoking myself.

PHILIP WILLIAMS: Stephen Williams also says it's Australia that is leading the way.

STEPHEN WILLIAMS: What we have noticed in particular is how vociferously the tobacco companies fought the legislation in Australia. So we already know some of the tricks they're going to get up to and are well prepared for it.

PHILIP WILLIAMS: As Australia steps into the High Court ring with tobacco companies, there are more than Australian interests at stake: the British and many other governments are watching and waiting. A test of legal skill and will that has implications far beyond Australia's shores.

The New Zealand government says it is now considering similar legislation in order to cut down on health problems caused by smoking.

New Zealand's associate health minister Tariana Turia spoke to me a short time ago.

Minister, why are you considering changing cigarette packaging in New Zealand now?

TARIANA TURIA: Well, we've been aware of the Australian moves on plain packaging and in fact we did issue a statement supporting Nicola Roxon's announcement when the legislation was proposed back in April last year. And basically we have been following up on what she has been doing and we have looked forward really to New Zealand following suit.

So we have been doing our own policy work on the option of introducing plain packaging so that we could align with Australia.

ELEANOR HALL: Will you wait for the High Court result in Australia before you legislate?

TARIANA TURIA: Well, what we are doing is, at the moment we have agreed in principle and we are out now consulting with the constituency around this issue.

So we think that will probably take some time. We do want to spend time doing that because we want to be sure that we have got the support, and we are hoping that by the end of the year we should be able to make some more substantive decisions.

ELEANOR HALL: How strong is the tobacco lobby in New Zealand? Do you expect the industry to challenge you in New Zealand's courts if you do decide to go ahead with legislation?

TARIANA TURIA: Well, they have certainly been threatening to do that but we shouldn't be allowing tobacco companies to be determining our domestic law. So while we appreciate that this is an issue that they will take up, we also believe that in terms of Australia, they have constitutional law and it is not directly relevant to New Zealand.

So while we know that the tobacco industry has got deep pockets and is finding all sorts of ways to challenge plain packaging under domestic and international law, we also believe that we actually have a very good case.

ELEANOR HALL: So if the Australian Government loses this challenge, would you shelve your plans?

TARIANA TURIA: Well, that would depend on what Cabinet decides but as I said, we do have a different argument in terms of the regulation of tobacco products and pursuit of public health goals, and that doesn't diminish the property of the tobacco company so we feel fairly confident that if we adopt this approach that we wouldn't lose any court case.

ELEANOR HALL: You say that the tobacco industry is already threatening. The governments of Honduras and Ukraine are also signalling that they'll back the tobacco industry and challenge these sorts of laws in the World Trade Organisation. How big a fight do you expect if you do legislate for plain packaging?

TARIANA TURIA: Well, I guess that remains to be seen. We don't actually have any evidence of exactly what it is that they will do or whether other countries will in fact join in but we are certainly supporting Australia.

I understand that Britain is also looking at this as well and I guess that in the end our main focus is the fact that we have over 5,000 people who die a year from this killer substance and we need to do something about it.

Apr 19, 2012 11:27am EDT(Reuters) - The world's top tobacco groups fear if new rules on plain packaging take hold in Australia and Britain they may spread to higher growth and potentially more lucrative emerging markets and put a curb on their future profits growth.

Health campaigners are pushing for tobacco companies to package their cigarettes in plain packs displaying the product name in a standard typeface and with graphic health warnings as a way of discouraging youngsters from taking up smoking.

Australia aims to become the first nation in the world to force tobacco groups to sell cigarettes in these plain, brand-free packets by December this year, while Britain this week launched a three-month consultation over the issue.

"It seems inevitable that should Australia succeed in easily implementing plain packs, that other regulators will explore the potential to do likewise," said analyst Chris Wickham at brokers Oriel Securities.

Analysts say that if Australia adopts these plans then the next battlegrounds are likely to be Britain, Canada and New Zealand, and will cause concern to tobacco companies which have seen their shares performed strongly so far in 2012.

"With tobacco stocks back on high relative valuations and fears of a plain packaging contagion spreading from Australia, we see a risk that the sentimental climate on tobacco once again becomes more questioning and skeptical," said analyst Martin Deboo at brokers Investec Securities.

Analysts say the real risk from plain packaging to industry profits would be if it spreads to emerging markets such as Brazil, Russia and Indonesia and so slow the process of smokers moving to more pricey and profitable cigarette brands.

Emerging market smokers aspire to westerns brand such as Marlboro, Lucky Strike and Camel, which confer status on the individual, and these mean bigger margins to the cigarette makers than the local brands that smokers are abandoning.

Smokers in mature markets like Western Europe and North America are more fixed in their habits and reluctant to change brands and so changes to packaging are likely to have a relatively low impact on smoker's choices, analysts added.

With falling smoking levels in these mature markets the world's big four tobacco groups Philip Morris, British American Tobacco, Japan Tobacco and Imperial Tobacco have offset this by looking to fast-growing emerging markets to drive overall growth.

This growth has been helped by tobacco groups introducing innovative packaging to attract consumers, and if this avenue is closed by plain packaging rules, the cigarette companies will find it harder to push smokers towards more expensive products.

The industry is fighting against the proposed plain packaging legislation in Australia taking its battle to the high court and have been giving evidence over the last three days as analysts say tobacco groups are fearful that many other governments are looking to Australia as a test case.

Australia has some of the toughest anti-smoking rules in the world banning tobacco advertising, smoking in public places and the public display of cigarettes in shops, while in some states it is illegal to smoke in a car with children present.

Under these tough Australian rules only around 15 percent of adults smoke compared with 23 percent a decade ago, while in Britain the current figure is around 22 percent, analysts said.

The British market is in slow decline like many other mature ones but Britons still smoke around 56 billion cigarettes a year, which the government says is responsible for over 100,000 deaths a year and puts pressure on the public health system.

This is why Health Secretary Andrew Lansley announced his consultation process to run for 12 weeks up to July 10, and Lansley has insisted that he is keeping an open mind.

Rath, what are the current smoking laws in Austrailia? OUr is warnings on the cigareete packages, no television adds for smoking, and almost every state has no smoking justs about everyplace, work place, restraunts, public places are all smoke free. 2nd hand smoke is a huge issue. Do you have those laws in Austrailia too?

Even at my work, for years you could smoke, than they changed it and you had to go outside, than they changed that, and you could not smoke on the property, you had to leave the entire plant, go out to the city sidewalk and smoke.

I am a none smoker, so I'm in favor of all these laws personally. Being near cigareete smoke does bother me.

rath wrote:Apr 19, 2012 11:27am EDT(Reuters) - Australia has some of the toughest anti-smoking rules in the world banning (all forms) of tobacco advertising, smoking in public places and the public display of cigarettes in shops, while in some states it is illegal to smoke in a car with children present.

Under these tough Australian rules only around 15 percent of adults smoke compared with 23 percent a decade ago, while in Britain the current figure is around 22 percent, analysts said.

Greeney2.

Do you remember the publicity & outcry when the Australian anti smoking adds appeared on U.S & Canadian television a few years back.

Don't remember reading that, but glad you do. I remember 25 years ago, they had none smoking sections in restuarants, and we go sat right next to the smoking section, which a guy smoke a big cigar a few feet away. Not just us complained, and the guy was just brazen and rude, like it was his right, no matter how many people were affected We were at a very nice Crape restraunt.

greeney2 wrote:Don't remember reading that, but glad you do. I remember 25 years ago, they had none smoking sections in restuarants, and we go sat right next to the smoking section, which a guy smoke a big cigar a few feet away. Not just us complained, and the guy was just brazen and rude, like it was his right, no matter how many people were affected We were at a very nice Crape restraunt.

yhe same, im a none smoker & im loving the tougher laws.

why should i be forced to pay for healthcare (Tax) to treat smoking related cancers in somebody whose choice it was to smoke.

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